Yahoo Finance I Grew Up Middle Class: Here’s How I Broke My Worst Money Habits as an Adult
Growing up in a middle-class family often instills a certain set of financial habits and mindsets. While these habits can be beneficial in some ways, they may also hold you back from achieving greater financial freedom and fulfillment.
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GOBankingRates spoke with five people who grew up in the middle class about what they learned and saw with money growing up. Here are some of the financial habits each person decided to change in order to achieve a more balanced and fulfilling financial life.
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Prioritized Enjoying Life Now Instead of Stashing Everything Away
Saving for the future is important, but it’s also equally crucial to enjoy the present. Many middle-class individuals grow up with the mindset that every extra penny should go into savings or investments, sometimes at the expense of current happiness and experiences.
“Growing up middle class made it hard for me to feel comfortable spending money so when I became an adult, my default was to always save, save, save and delay gratification,” says Zach Whelchel, Founder of MyBudget Coach.
“I’m 32 now and have two kids ages three and two and having kids has helped me prioritize the present,” he added. “My wife and I stick to a budget which actually helps me spend more.”
Whelchel uses a zero-sum budget and says that since he knows all his needs are covered due to using as detailed budget, he now feels more comfortable spending money on “fun” things like travel as well as setting aside $50 per month in an account nicknamed “kids plus” that he created to fund extra family fun.
Switched From a Scarcity Mindset to an Abundance Mindset
A scarcity mindset focuses on limitations and what you lack, leading to stress and anxiety. Edna Forero, a Chartered Financial Consultant and Accredited Financial Counselor says finances were erratic while growing up in her family which ultimately led her to develop a scarcity mindset.
“I often told myself I would make sure the lights stay on and that my fridge was always full, Forero says. “I recently decided to work on my scarcity mindset and to learn how to approach life with abundance.”
One of Forero’s earliest memories was using a coin jar to collect money. As the jar got full, she realized that the money would eventually get taken or be used on something else.
Forero shared that she’s struggled with being able to hold onto her savings in the past. But now, she’s realized that it’s okay to set money aside and she can allow the money to grow without fear of it being taken.
“This new mindset helped me pay off my student loans five years ago and my husband and I are committed to saving and helping our four kids graduate without student loans ,” Forero said.
Stopped Impulse Buying and Began Saving Automatically
Impulse buying can derail your financial goals, leading to unnecessary debt and financial stress. Shavon Roman, a Personal Finance Expert and founder of Heal Plan Invest, says that she would spend a lot of money on unnecessary impulse buys which are often fueled by emotions.
“If I needed an item, I would always just buy it without a thought,” Roman said. “But now, I switched to delaying a purchase for 48 hours so I could make the choice with clarity.”
Roman says using the 48 hour rule also helped her start saving more of her hard-earned money as well. She now automatically saves 20% of her income using direct deposit from her paycheck before handling her other expenses and bills.
Took a 14-Month Backpacking Trip at 24 Years Old
Sometimes, the best way to break stubborn money habits is to head completely in the opposite direction. For Brock Waterman, founder of Fire Travel Family, he was always taught to save money and only spend on absolute necessities.
“I was trained to believe that I should stash away everything in order to retire in my sixties and finally get to enjoy life,” Waterman said. “It was like the amount in my account was equal to my value as a person.”
At the age of 24 though, Waterman quit his full time job, sold most of his possessions (including his house), and went on a 14-month backpacking trip.
“It was one of the best decisions of my life,” said Waterman. “People say money equals freedom, but this is only true if you are willing to use some of your savings because there is no guarantee that you will even reach the typical retirement age.”
Waterman and his wife have since worked hard to reach FIRE (Financial Independence Retire Early) while their kids were young and have tried to enjoy life along with the intentional travel and activities.
Paying a Professional Instead of DIYing
While DIY projects can save money, they can also lead to costly mistakes and wasted time. Jim Wang, Founder of WalletHacks, grew up in a middle-class family that was super frugal and preferred to DIY everything instead of hiring out.
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“My dad had a white-collar job at a national lab, but we were always saving up money to fly to Taiwan so we often tried to save as much as possible,” said Wang. “As an adult though, I’ve learned that it’s sometimes better to get a professional to do certain things as this saves time and can provide better quality.”
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This article originally appeared on GOBankingRates.com: I Grew Up Middle Class: Here’s How I Broke My Worst Money Habits as an Adult
